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A Brief Comment on “Humanizing Cost-Benefit Analysis”

Published online by Cambridge University Press:  20 January 2017

Michael A. Livermore
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Extract

On Tuesday, January 18, 2011 President Obama issued a new executive order and two somewhat related memoranda which embody some of the principles discussed by the Office of Information and Regulatory Affairs (OIRA) Administrator Cass Sunstein in this Journal. Building on three decades worth of practice in the United States with regulatory review, the new order and memoranda maintain significant continuity with past experience, while emphasizing both “humanizing” and rationalizing elements in the practice of regulatory impact analysis.

Type
Symposium on Regulatory Reform in the EU and the US
Information
European Journal of Risk Regulation , Volume 2 , Issue 1 , March 2011 , pp. 13 - 17
Copyright
Copyright © Cambridge University Press 2011

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References

1 Exec. Order No. 13,563, 76 Fed. Reg. 3821 (Jan. 18, 2011).

2 Memorandum for the Heads of Executive Departments and Agencies on Regulatory Compliance, 76 Fed. Reg. 3825 (Jan. 18, 2011); Memorandum for the Heads of Executive Departments and Agencies on Regulatory Flexibility, Small Business, and Job Creation, 76 Fed. Reg. 3827 (Jan. 18, 2011).

3 58 Fed. Reg. 51,735 (Sept. 30, 1993).

4 Minor modifications were made at the end of President Bush’s term. Executive Order 13,422, 72 Fed. Reg. 2763 (Jan. 18, 2007). These revisions were rescinded on February 4, 2009. Executive Order 13,497, 74 Fed. Reg. 6113 (Jan. 30, 2009).

5 See Murray Weidenbaum, “Regulatory Process Reform from Ford to Clinton”, 20 Regulation (Spring 1997), at p. 20. Weidenbaum was an early proponent of the use of cost-benefit analysis, and was a member of President Reagan's Council of Economic Advisors. Richard L. Revesz and Michael A. Livermore, Retaking Rationality: How Cost-Benefit Analysis Can Better Protect the Environment and Our Health (2008), pp. 22–25.

6 Id., at p. 11.

7 Exec. Order No. 12,291, 46 Fed. Reg. 13,193 (Feb. 17, 1981).

8 Id.

9 Id. Sec. 3 (f)(2). This requirement was subject to the caveat that “[n]othing in this subsection shall be construed as displacing the agencies’ responsibilities delegated by law.”

10 See, e.g., “Public Citizen, Safeguards at Risk: John Graham and Corporate America's Back Door to the Bush White House” (March 2001).

11 Kagan, Elena, “Presidential Administration”, 114 Harv. L. Rev. (2001), p. 2245 CrossRefGoogle Scholar.

12 Mooney, Chris, “Paralysis by Analysis, Jim Tozzi's Regulation to End All Regulation”, 36 Wash. Monthly (May 2004), pp. 23, 24Google Scholar.

13 Compare Obama Order section 2(c), supra note 1 with Clinton Order section 6(a)(1), supra note 3.

14 Memorandum for the Heads of Executive Departments and Agencies on Regulatory Compliance, supra note 2.

15 See generally Shavell, Steven, “A Note on Efficiency vs. Distributional Equity in Legal Rulemaking”, 71 Am. Econ. Rev. (Papers and Proc.) (1981), p. 414 Google Scholar.

16 Clinton order section 1(a), supra note 3.

17 See, e.g., Office of Management and Budget, Circular A-4, Regulatory Analysis: Memorandum to the Heads of Executive Agencies and Establishments (Sep. 9, 2003); Environmental Protection Agency, Guidelines for Preparing Economic Analyses (2010).

18 Clinton order section 1(a), supra note 3.

19 Obama order 1(c), supra note 1.

20 See H.M Treasury, The Green Book: Appraisal and Evaluation in Central Government 25 (2003), pp. 91–96.

21 EPA, Office of Envtl. Justice, EPA's Action Development Process: Interim Guidance on Considering Environmental Justice During the Development of an Action (2010), available on the Internet at <http://www.epa.gov/compliance/environmentaljustice/resources/policy/considering-ej-in-rulemaking-guide-07-2010.pdf>.

22 EPA, Office of Enforcement & Compliance Assurance, Plan EJ 2014 Draft for Public Comment (2010), available on the Internet at <http://www.epa.gov/environmentaljustice/resources/policy/plan-ej-2014.pdf>.

23 Cass Sunstein and Richard H. Thaler, Nudge: Improving Decisions about Health, Wealth, and Happiness (2008).

24 Id. at p. 14.

25 Clinton order section 5, supra note 3.

26 See, e.g., Greenstone, Michael, “Toward a Culture of Persistent Regulatory Experimentation and Evaluation” in Moss, David and Cisternino, John (eds), New Perspectives on Regulation (2009)Google Scholar.

27 Obama order section 6 (a), supra note 1 (emphasis added).

28 Clinton order section 4, supra note 3.

29 Id. section 4(b).

30 Id.

31 Obama order section 3, supra note 1.

32 Dep't of Energy, Small Electric Motors Final Rule Technical Support Document Appendix 15A: Social Cost of Carbon for Regulatory Impact Analysis Under Executive Order 12866 (2010)(presenting the results of the Interagency Working Group on Social Cost of Carbon).

33 Letter from Richard L. Revesz and Michael A. Livermore to Office of Information and Regulatory Affairs Administrator Cass Sunstein (Dec. 16, 2010), available on the Internet at <http://policyintegrity.org/documents/12.16_.10_OIRA_Interagency_Label_Letter_.pdf>.

34 See, e.g., Small Business Regulatory Enforcement Fairness Act, Pub. L. 104-121 (1996) (amending Regulatory Flexibility Act).